🎓 Finance & Economics • Interest & Time Value
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Annuity Present & Future Value Calculator
Calculates present and future values of equal periodic cash flows for both ordinary annuities and annuities due.
Periodic Cash Flow Stream Valuation
Annuity Present & Future Value
Evaluates fixed periodic payments under Ordinary Annuity (payments at end of period) or Annuity Due (payments in advance).
Accumulated Future Value (FV)
$6,590.4
Includes $1,590.4 total compounding interestDiscounted Present Value (PV)
$3,680.04
Current lump-sum equivalent of 10 paymentsGoverning Actuarial Equations:
FV = PMT · [((1 + r)ⁿ - 1) / r] = $6590.4
PV = PMT · [(1 - (1 + r)⁻ⁿ) / r] = $3680.04
What is an Annuity in Finance?
An annuity is a series of equal payments made at regular intervals (monthly, quarterly, or annually). An ordinary annuity pays at the end of each period, while an annuity due pays at the beginning.
Formula & Step-by-Step Calculation
FV_ord = PMT · [ ((1+r)ⁿ - 1) / r ], PV_ord = PMT · [ (1 - (1+r)⁻ⁿ) / r ]
Closed-form geometric series summation.
Worked Step-by-Step Examples
Example 1
Deposit $500 annually for 10 years at 6% interest
Solution: Ordinary Annuity FV = $6,590.40, PV = $3,680.04
• FV = 500 × [ (1.06¹⁰ - 1) / 0.06 ] = 500 × 13.1808 = $6,590.40
Common Real-World & Academic Use Cases
- ✓ Pension and insurance guaranteed payout modeling
- ✓ Mortgage and structured settlement valuations
- ✓ Lease payment present value evaluations
How to Use the Annuity Present & Future Value Calculator
1
Choose Annuity Type
Select Ordinary Annuity or Annuity Due.
2
Enter Periodic Payment (PMT)
Specify payment amount, interest rate, and term.
3
Read Present & Future Value
Inspect total cash values.
Frequently Asked Questions
Q: Why is an Annuity Due worth more than an Ordinary Annuity?
Because each payment in an annuity due is made at the start of the period, earning an extra compounding period of interest: FV_due = FV_ord × (1 + r).